Why Estate Planning for Elderly Parents is Important?
When it comes to elderly parents i.e. who are above 65, it is really difficult for the children to take care of them in the long term and to arrange money for it. After this age, their mental and physical health starts deteriorating and they may require more time, care and resources. It is a fact that none of us would want our assets to be lost due to the expensive long term health care costs. Many times, such costs could be adequate and can lose a good sum of amount from savings. Thus, in order to avoid such situations, it is advised to have elderly estate planning.
The elderly estate planning is required as at some point of time, your parents might need long term care which needs a good amount of money and even you may be required to take a decision for your parents which might be difficult for you. Hence, at first, it is required that you must have a discussion about what are your parents’ wishes, the care they want for them and the number of assets they own so that it could be known that how long would their money will help them.
Estate Planning for Elderly Parents-
Though it might sound awkward and would be uneasy to have a discussion on the aforementioned thing with your parents, however, in the long run, it will not create more stress in the stressful circumstances. Hence, even if there is a plan in place by your parents you must ensure it would be reviewed as it might be the case that it has become obsolete.
While discussing for your elderly parents, you must cover the below points surely:
1. The desire of your parents:
It might be awkward to ask your parents, however, it is mandatory as you must be aware of their wishes so that you would be able to make decisions for them according to them.
Know if there is an estate plan of your parents: In case, your parents don’t have their estate plan ready then it is the time that you have to talk to them and help them in doing so. On the other hand, if they have their estate plan in place then you must ensure that it is reviewed recently and if not you can take the help of a lawyer and update it accordingly.
2. Parents’ Medicare and Medicaid coverage:
You must be aware that Medicare doesn’t cover the long-term care expenses, however, Medicaid does. Thus, it is very important that you should know which Medicare coverage do your parents have and what are the financial aspects of the insurance.
After having the discussion, you must also ensure that your parents have the following documents ready and updated with them:
1. Advance health care directive:
It comprises a health care proxy and a living will. Through a healthcare proxy, your parents can appoint a person to legally make medical decisions for them in case they become incapable to do so. While a living will describe the type of medical treatment your parents would want if they are critically ill. It comprises end-of-life guidelines that specify the level of disability you’d be willing to live with and how to let you die if you had no hope of recovery.
2. A durable power of attorney:
This document allows your parents to allow a person to make important decisions about financial, property and legal matters if your parent ever becomes incapacitated. They can even place limitations on their attorney which vary according to their requirements. By specifically picking someone to make those decisions, they will be relaxed and stress-free for such conditions.
A will allows your parents to state the fate of their assets after their demise. If there is no will their assets will be distributed according to the state law which might not be as per their desire. The will must appoint an executor who will be responsible for estimating and dispensing the assets, paying taxes and settling debts owed by the deceased.
4. Letter of instruction:
Apart from the basic documents of estate planning, your parents must leave a “letter of instruction” for your representatives specifying every detail to help them manage your assets. It will help the appointed people to find them to identify the location of legal documents and instructions for them to full fill their wishes in their chosen way.
No one likes to talk about death and dying, and it can be especially difficult for adult children to contemplate their parents’ aging and death. Putting your affairs in order is not about death. It’s about making sure things get done your way and the right way. As their caregiver, you can make the difference in the quality of life for your aging parents and if staying in their home is a possibility, you will have the legal authority to make it happen. Remember, the only time you come out on the short end is if you fail to prepare!